Citi ending its AAdvantage(R) Debit Card program

Maybe this belongs not under AAdvantage but over in the credit-card area. However, what I am about to post involves debit cards, not credit. Did check over there to see if I saw anything relevant, didn't, and thus will post here.

"After December 9, 2011, Citibank will no longer offer the Citibank(R) / AAdvantage (R) debit card rewards program. Here are some important things you need to know:

". You will retain the American Airlines AAdvantage (R) miles you've already earned, provided that <you have activity in your AA account at least once every 18 months> . . .

". In November, you will be sent a new debit card to replace your existing Citibank(R) / AAdvantage (R) debit card. However, this will not impact the debit rewards you earn through December 8, 2011. Your debit card number and PIN will not change.

" Customers who paid the Citibank(R) / AAdvantage (R) debit card rewards program annual fee will receive a prorated credit to their checking acount in December based on when the fee was paid.

". . . As always, you'll continue to earn American Airlines AAdvantage (R) miles with your Citi(R)/AAdvantage(R) credit card. Please visit www.specialoffers.citicards.com and enter invitation number <number> to see if you qualify for a limited-time, special offer that could earn you even more AAdvantage (R) miles on purchases with your credit card. <I plan to do that, haven't yet.>"

Maybe this belongs not under AAdvantage but over in the credit-card area. However, what I am about to post involves debit cards, not credit. Did check over there to see if I saw anything relevant, didn't, and thus will post here.

"After December 9, 2011, Citibank will no longer offer the Citibank(R) / AAdvantage (R) debit card rewards program. Here are some important things you need to know:

". You will retain the American Airlines AAdvantage (R) miles you've already earned, provided that <you have activity in your AA account at least once every 18 months> . . .

". In November, you will be sent a new debit card to replace your existing Citibank(R) / AAdvantage (R) debit card. However, this will not impact the debit rewards you earn through December 8, 2011. Your debit card number and PIN will not change.

" Customers who paid the Citibank(R) / AAdvantage (R) debit card rewards program annual fee will receive a prorated credit to their checking acount in December based on when the fee was paid.

". . . As always, you'll continue to earn American Airlines AAdvantage (R) miles with your Citi(R)/AAdvantage(R) credit card. Please visit www.specialoffers.citicards.com and enter invitation number <number> to see if you qualify for a limited-time, special offer that could earn you even more AAdvantage (R) miles on purchases with your credit card. <I plan to do that, haven't yet.>"

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A friend of mine works at Citibank and alluded to this awhile back. Sad to see it go.

A friend of mine works at Citibank and alluded to this awhile back. Sad to see it go.

On a related note, guess who's looking for a new bank?

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You too?

I have had hassle after hassle with Citibank, which I sometimes tend to spell with an "sh" rather than a "c." And on some of those hassles I have been transferred to somewhere in East Asia, already up tight about my problems, and then when the agent and I had trouble understanding each other, it just drove me up a tree. I have learned to ask for "a supervisor in the United States" early on in those conversations, and apparently according to their policy they are required to give you one. Anyway, amidst all those hassles, the only reason I stayed, really, was the AAdvantage miles. And now. . . .

I have had hassle after hassle with Citibank, which I sometimes tend to spell with an "sh" rather than a "c." And on some of those hassles I have been transferred to somewhere in East Asia, already up tight about my problems, and then when the agent and I had trouble understanding each other, it just drove me up a tree. I have learned to ask for "a supervisor in the United States" early on in those conversations, and apparently according to their policy they are required to give you one. Anyway, amidst all those hassles, the only reason I stayed, really, was the AAdvantage miles. And now. . . .

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I've never had service issues but really I was only there for the miles. I did like that Citibank has a nice international presence, unlike so many other US banks.

Either way, now that the debit option is gone, I'll keep my credit card and shop around for a bank. I'm sure there's a better deal somewhere!

A few months ago, I opened a Citi account for the sole purpose of being able to earn AA miles. After I got the letter, I tweeted @AskCiti that I would be closing my account once my open transactions clear. They tweeted back asking if they could call and "discuss options." I said OK, but I don't expect anything to come of it. The only Citi miles earning options are credit cards, which I don't think my finances (currently unemployed) will permit me to get at this point, and I have ZERO interest in ThankYou points.

I still have my BofA checking account, and I'll move the money back there & use my US debit card for debit transactions. They just announced a plan to charge monthly fees for debit cards, but I'm willing to pay that in exchange for the ability to earn miles. The only other debit/miles option is SunTrust & DL, and they're called SkyPesos for a reason. If BofA eliminates their miles earning debit cards, I'll give DL & SunTrust a try, but otherwise it's back to BofA for me.

A few months ago, I opened a Citi account for the sole purpose of being able to earn AA miles. After I got the letter, I tweeted @AskCiti that I would be closing my account once my open transactions clear. They tweeted back asking if they could call and "discuss options." I said OK, but I don't expect anything to come of it. The only Citi miles earning options are credit cards, which I don't think my finances (currently unemployed) will permit me to get at this point, and I have ZERO interest in ThankYou points.

I still have my BofA checking account, and I'll move the money back there & use my US debit card for debit transactions. They just announced a plan to charge monthly fees for debit cards, but I'm willing to pay that in exchange for the ability to earn miles. The only other debit/miles option is SunTrust & DL, and they're called SkyPesos for a reason. If BofA eliminates their miles earning debit cards, I'll give DL & SunTrust a try, but otherwise it's back to BofA for me.

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The United States Federal Reserve ("the Fed") has capped the banks' fees to merchants on debit cards. While Citi's letter today didn't blame the Fed, I very much assume that is a big reason for the change. I had read financial stories elsewhere that banks were going to have to cut their rewards to customers to compensate. Actually in my case I could switch everything over to my Citi AAdvantage Master Card and Citi AAdvantage American Express credit cards, still get the miles, and SAVE money (reason, I won't any longer have the annual fee for the debit card, and I pay my credit card bills in full every month and thus have no interest charges). But, unlike DestinationDavid, Citi has so irked me with its service that I am going to keep the credit cards and move my checking and savings to a bank with a presence here in Wichita -- and use the debit-card change as an excuse that finally pressed me to act.

Most of the service issues I have had would be way off-topic in this forum, but one of them arguably has some relevance.

Several summers ago I was on a massive miles-burning binge with the goals of going to several Major League Baseball parks on both coasts in my quest to eventually get to ALL active ball parks (which I since have accomplished). That summer I also wanted to sample AA's F-class on the transcon 762 (Milesaaver reward). So, based in Kansas, I went to New York, then SFO, then SAN via AS, then OAK, back SFO-JFK, down to PHL, up to BOS on the Acela I had never ridden, down to New York and home again all in about a week (6 ballparks). My Citi account was relatively new then, and since Citi has no ATMs in Wichita, I had never made an ATM deposit with that bank. So in SAN I went to a Citi branch and deposited $20. Got to SFO and got an e-mail from Citi saying my deposit envelope was empty and the $20 deposit was cancelled. Was on the phone for an hour from the SFO LaQuinta convincing Citi it was their error, not mine. I was told all would be well. Wrong. Got to New York and tried to use an ATM, but was blocked from my checking account as punishment (they would deny that term) for the empty deposit in SAN. Took another two days to get ATM access restored, and it really hacked me off. What if I would have needed cash? (And yes, they later found their $20, which I knew all along had been in that envelope.)

So that's my airline-baseball related-Citi crappy service story.

Anybody can goof up one time, but add the others not related to airlines (most involving inordinate delays in mail deposits, and a website login problem), plus the difficulty of dealing with phone staff in India, and. . . . when I got the letter today about the AAdvantage debit card program ending, I said "enough is enough."

Chase discontinued earning UA miles on debit cards in July and they are "piloting" a $3/month fee for debit card usage in "a few markets". Not sure what the markets are, so far not in my area. They have been very "mums the word" on the markets. I bank with Chase because they have a large ATM network in the US. If this fee is implemented, not sure what to do. They have already taken away debit card rewards. I use my debit card over my credit card for 90% of my purchases. Guess that means I will use a credit card again for everything.

The BoA debit card fee was all over the news last night and this morning.

This just provides a good opportunity to join that local credit union. I know for me I have branches wherever I go through shared branching, and it is real easy to hit up fee free ATMs, since many credit unions are a part of a shared branching network.

I still have my BofA checking account, and I'll move the money back there & use my US debit card for debit transactions. They just announced a plan to charge monthly fees for debit cards, but I'm willing to pay that in exchange for the ability to earn miles. The only other debit/miles option is SunTrust & DL, and they're called SkyPesos for a reason. If BofA eliminates their miles earning debit cards, I'll give DL & SunTrust a try, but otherwise it's back to BofA for me.

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Of course, after I post this, BofA decides to have some of their periodic web site issues.

Citi's decision to discontinue the AA Advantage debit card program is incontrovertible evidence of a corporate ethos that puts profit before customer satisfaction. Their ending frequent flier mile earning opportunities may seem like a trivial issue compared with other crimes that banks are getting away with, but it is highly symbolic of the industry's overall disregard for the consumer. This was not a free program ($65 annual fee). The Dodd-Frank law is not to blame for creating this situation. Debit card interchange fees have not been eliminated, they have been reduced. Citi's choice to end the program will result in the loss of untold millions of debit card transactions because customers will stop using debit cards as there is no incentive for them to do so. How can no interchange fees possibly be better than reduced interchange fees? Forcing customers who wish to continue earning frequent flier miles into credit card accounts is not the solution--for many reasons, including high interest rates. Please join me in my efforts to try to save this program:

Citi's decision to discontinue the AA Advantage debit card program is incontrovertible evidence of a corporate ethos that puts profit before customer satisfaction. Their ending frequent flier mile earning opportunities may seem like a trivial issue compared with other crimes that banks are getting away with, but it is highly symbolic of the industry's overall disregard for the consumer. This was not a free program ($65 annual fee). The Dodd-Frank law is not to blame for creating this situation. Debit card interchange fees have not been eliminated, they have been reduced. Citi's choice to end the program will result in the loss of untold millions of debit card transactions because customers will stop using debit cards as there is no incentive for them to do so. How can no interchange fees possibly be better than reduced interchange fees? Forcing customers who wish to continue earning frequent flier miles into credit card accounts is not the solution--for many reasons, including high interest rates. Please join me in my efforts to try to save this program:

Saying that Dodd-Frank is not to blame here is like saying a hurricane isn't to blame for the food in your refrigerator spoiling when the power goes out because the hurricane hit the local power station. Citi is not the only one ending these types of programs. Legislation like Dodd-Frank has caused the bank's to look elsewhere for profits. This, too, like lots of other more lucrative mileage opportunities, has come to an end.

Unfortunately, I think we all know how this is going to end, based on prior experience. People will say that switching to credit cards is not the answer, but it's probably the only "reasonable" solution if you want to continue earning the same mileage / spend ratio -- and quite frankly as long as you pay your balance immediately, you should see no impact.

At the end of the day, banks hate losing money, and the new legislation will reduce their intake by over $9 billion a year, so they will undoubtedly scrap any sort of rewards programs associated with debit card use, plus increase monthly fees to compensate.

People will leave, but I'm sure they have taken this into account and calculated that the loss of customer accounts will be insignificant, or that at the very least it will be offset by the new fees they're imposing.

My note to them outlined, relatively specifically, the customer service problems I had experienced over several years and said the only thing that kept me from leaving was the AAdvantage miles/Debit program. I said, with that program now ending, I would be closing my deposit accounts, on my own timetable, once I rearranged a considerable number of automatic credits and debits with various companies and institutions that were set up.

The reply, in so many words, seems to be: "sorry to lose you. You might consider 'ThankYou' points."

Dear Mr. ------,

Thank you for your message regarding your concerns and I am sorry to hear you will be closing your accounts with Citibank. I apologize for the bad customer service experiences that occurred in the past, as we strive for client satisfaction. My name is Selena, and I value your relationship. It is a pleasure to hear from you today. I constantly strive to exceed my clients' expectations and I will be happy to help you today.

As our client, you are the foundation of our business and we are always seeking new opportunities to better serve you. I have forwarded your comments to our management team for further review. I have also submitted a Client Talk form on your behalf, which is used to communicate general comments and concerns to the marketplace management.

At this time the Client Talk form does not generate a call back; however, each submission is reviewed and taken into consideration for revisions, follow-up action, and/or implementation. If you have any additional feedback or suggestions regarding our products or services, we would love to hear from you. When sending an online message, simply select "Other Accounts" and then "Site Feedback/Suggestions."

I invite you to take a look at another program we have available, I see that you are not taking full advantage of your relationship with Citibank and I would like to take this time to enhance your experience. As a valued client, you can reward yourself with accounts that you currently have with Citibank. This could save you money on your personal, holiday, and vacation needs. For more details, click the "Service Center" link, and then click "Rewards Program." It is free to enroll in the "ThankYou" Network.

Mr. ------, as a valued client you are the foundation of our business, and I sincerely value your trust in Citibank throughout the years. I look forward to hearing from you again in the future.

If there is anything else, we can do for you, please send us a message or call Citibank Online Client Services at 1-800-374-9700. Internationally, you can call us at 001-210-677-0065. We are available to assist you 24 hours a day, 7 days a week.

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